GAO issues opinion on ACA transitional reinsurance program

The Department of Health and Human Services lacks authority to pay health insurance issuers before the Treasury when allocating payments in the transitional reinsurance program, according to an opinion issued yesterday by the Government Accountability Office. The chairmen of several House and Senate committees asked GAO whether HHS has the authority, in the event its collections from issuers do not reach the specified amount for reinsurance payments, to prioritize payments to issuers over payments to the Treasury. The Affordable Care Act designates a specified amount of collections from issuers for reinsurance payments and also directs the deposit of a specified amount of collections in the general fund of the U.S. Treasury, GAO said. When 2014 collections fell short of the target amount for reinsurance payments, HHS did not allocate any collections to the Treasury. In the report, HHS asserts that the statute does not prescribe how contributions are to be allocated if the total amount collected is insufficient to meet the statutory targets.